Kush Bottles: Meet One of the Hottest Marijuana Stocks

Kush Bottles derives its revenue primarily from the sale of marijuana packaging and ancillary products like vaporizers, rather than the sale of marijuana. The company’s main customers are marijuana dispensaries and distributors, who purchase its products in bulk for retail sale. The company currently sells products in four major categories: bags, tubes, containers, and vaporizers.

According to commentary from a July 2017 presentation, Kush Bottles was selling more than one million pre-rolled tubes each month. The company has a patent on the child-resistant mechanism on its tubes, a potential point of differentiation in the marketplace, though there are currently several different types of child-resistant tubes competing for market share.

To expand its offerings and footprint, the company has completed three major acquisitions over its history.

1. Dank Bottles — Acquired on April 10, 2015, Dank Bottles was the exclusive distributor of Kush Bottles’ products in Colorado. Kush Bottles paid for the acquisition with $373,725 in cash and 3.5 million shares of stock.

2. CMP Wellness — Kush Bottles acquired CMP Wellness on May 1, 2017. CMP Wellness’ primary products are portable vaporizers, cartridges, and accessories. Kush Bottles paid for the acquisition with $2.3 million of cash and promissory notes, plus 7.8 million shares of restricted stock. The deal also included earn-outs of $1.9 million in cash and up to 4.74 million more shares of Kush Bottles to be paid out based on the company’s performance.

3. Roll-Uh-Bowl — On May 3, 2017, Kush Bottles acquired Roll-Uh-Bowl, which sells portable, silicone water pipes. Kush paid for the acquisition with $150,000 of cash and 200,000 shares of stock.